Extrinsic Motivation: Are Incentive Plans the Answer to the Problem That Faces Corporate America?

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Extrinsic motivation? What is it? Is it effective? As I began my SIP research
and internship at IBM, I decided that these were questions that I wanted to answer.
Motivation is more psychological than economic or business related, but it is corporate
America that ultimately benefits from motivation or is harmed by a deficiency of proper
motivation. Extrinsic motivation is some form of external reinforcement such as monetary rewards. In contrast, intrinsic motivation is internal and can result from being
challenged, being a key player, or making decisions. As you will find out, it is not
extrinsic, but rather the intrinsic rewards that are the most effective motivators.
Motivation theories, though abundant, can be assembled into groups of similar
theories. Four of the mainstream theories are the need theories, the reinforcement
theories, the expectation theories and the theories based on values and beliefs. The need and reinforcement theories intrigued me the most, and so I researched their hypotheses more thoroughly.
Frederick Herzberg was a predominant need theorist that determined that man had
two sets of needs: his need to avoid unpleasantness and his need to grow psychologically.
He also proposed two sets of factors that influence these needs. The hygiene (or
maintenance) factors affect the need to avoid unpleasantness. The motivational factors
are those that affect psychological growth. Herzberg found that five factors affected
feelings of job satisfaction. They are: achievement, recognition for an achievement,
work itself, responsibility, and advancement. Researchers noticed that all of these factors
were linked in that they were all related to job content. There were also several factors
that, in contrast, were more frequently linked to feelings of job dissatisfaction. They are:
company policy, administration, supervision, salary, status, job security, interpersonal
relations, and working conditions. There is also a connection among the dissatisfiers;
they all relate to the atmosphere in which someone works. The satisfiers are more
effective motivators in the long run because they are sources of psychological growth.
The dissatisfiers are not effective motivators because they provide only temporary
solutions to man's need to avoid unpleasantness.
Alfie Kohn has also discredited traditional theories of motivation. He feels that
corporate America is being punished by rewards. Kohn explains that performance
evaluations, incentives and other monetary rewards inhibit employees' maximum
effectiveness. Furthermore, rewards tend to rupture relationships and team bonds, ignore
the actual workplace problems, undermine interest, and discourage risk-taking. Kohn
offers several solutions to these problems. Kohn has labeled three such solutions "The
Three C's of Motivation." The C's stand for: 1. collaboration in terms of working
collectively as a team, 2. content in terms of retaining interest and varying tasks, and 3.
choice in terms of allowing an individual to determine how to most effectively approach
his or her job. Kohn argues that effective implementation of these things will
significantly reduce the need for rewards. Meanwhile, job satisfaction and interest levels
increase as workers become more effective and committed to excellence.
After researching motivational techniques, I felt that IBM' s current incentive plan,
though fairly effective in the short run, was not enough to keep employees motivated and
committed to the job in the long run. Within the last few years and on a continual basis,
IBM has been committed to making the organization more effective and productive, both
for the benefit of the employees and the customers. In 1996, things will not slow down
for IBM. Restructuring will create an atmosphere of change and opportunity for those
employed by IBM. Potentially, this atmosphere will be a significant source of
stimulation and personal and psychological growth.